The Daily bulletin. [volume] (Honolulu [Hawaii]) 1882-1895, 1887-11-19

to be made Of the money, but seemed
to feel confident that he could have
it amended so that il would suit him.
So it was determined that Mr. Mac
farlane should return to Honolulu
and await developments, and also
arrange further details with the gov
eminent authorities. So he returned
and got the amended act and some
"cabinet resolution" as well as a
commission for Mr.. Armstrong.
Being personally interested in the
success of the undertaking, Mr..
Macfarlane wanted to see the docu-
ments which he was to carry, to
determine so far as he could
whether or not they we're satisfac-
tory. Mr.. Gibson would not con-
sent to this, so Mr.. NJ. went to the
King and got commission rs tinan-
cial agent of the government. Thus
he was placed on par with Mr..
Armstrong and could see all docu-
ments. But in consideration of
some actual services expected of
him, it was agreed that the Hawaiian
Government should pay his actual
travelling expenses-passages and
hotel bills. This was all he was to
have from this government, and he
has now no other claims against it
than his hotel bills and money
actually paid out for passages. He
does not know what arrangement
was made with Mr.. Armstrong, but
thinks his pay was to be nominal.
Both of them depended upon the
pay they hoped to get from the syn
dictate when it was formed, for real
profits. Meanwhile Mr.. Spreckels
had become hostile to the scheme
and did all in his power to defeat it.
He tried to keep Mr.. Macfarlane
from leaving Honolulu. But Mr..
NJ. left all of his business with his
brother and went in spite of law
suits. Arrived at San Francisco he
sent all his documents on to Mr..
Armstrong, who soon telegraphed
him that all was satisfactory, and
that the syndicate was forming.
Shortly afterward second telegram
reached him with the news that the
loan was floated. Thereupon he
went to London to attend to some
matters of detail.
Taking up Mr.. Armstrong; part
of the transaction, it seems that
when he received the papers from
Mr.. Macfarlane, he went TO work to
form syndicate to guarantee the
Loan. 1t is the custom to form a
new syndicate for each new loan
foated. The personnel of these
syndicates is not known to the pub
lie. All the guarantee which they
require is the good name of the
issuing house. The syndicates are
simply insurance companies. This
one guaranteed that the loan would
be taken from the Hawaiian Govern
ment at 80 per cent. For this they
were to receive a commission of D
per cent. This 5 per cent was ex-
actly in the nature of a premium
paid for insurance. If the loan had
failed to float at SO per cent the
syndicate would have had to take it
off the Hawaiian Government s
hands at that rate. Such things
have happened lately, with respect
to other loans. When this loan was
advertised for sale at SO per cent
many old stock brokers and dealers
shook their heads. Mr.. Wildly did
not think it possible that it would
float. Finally however he did sub
scribe for 5000 pounds. Of this
amount he received onl Y 400 pounds,
so far did the subscriptions exceed
the face of the loan. The loan was
a phenomenal and an unaccountable
success. Mr.. Wildly believes that
the bonds all went to the general
public. 1t is rule of the Exchange
that no stocks shall have an official
quotation until at least Is per cent
of them have passed into the hands
of the general public. 1t will be
remembered that Mr.. Macfarlane
said once before that it is rule that
all stock must be issued to others
than the syndicate unless all sub
scribers are satisfied. In this case
the subscriptions, as has been said,
were largely in excess of the face of
the stock, so an official quotation
was soon obtained.
Mr.. Wildly stated that besides the
commission paid to the syndicate for
underwriting, or guaranteeing the
success of loan, commission of
about % per cent is usually paid to
the issuing house (Mathesons in this
case), or per cent to issuing
brokers, J per cent for stamp duty,
and about / per cent for buying
brokers, or those who induce their
clients to invest in the securities.
Besides all commissions advertising
is heavy expense. He does not
know how heavy as he never did
such business. But these is no
other way to get the stock noticed
in the papers at all. And without
such notice loan can hardly sue
coed. 1t is the opinion of Mr..
Wildly that 1900 pounds are not an
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